The Research On Cost Mangement Inovation Of CSR Electric Company Limited

As a result of the continuous improvement of market economy and the rapiddevelopment of economic globalization and informatization, the competition betweenmanufacturers has become much fiercer. In order to be superior in the competition of cost,a cost management system which contains the concept of lean management and inaccordance with the company’s strategy is strongly needed. Therefore, in recent years, theinnovation of cost management has gradually become the core of enterprise managementand a hot research topic. Faced market opportunities and competitive environment, CSRElectric Company will make improvements in lean cost management. It will be thoroughlydiscussed in this article.The research objects in this paper are the present situation and practicableimprovements of CSR Electric Company’s costs management, mainly include: theoreticalstudies of cost management, lean management, risk management; study of the presentsituation, defect and practicable improvements of cost management; summarize andanalysis of the application of those practicable improvements.This paper starts with theory study, which leads to a comprehensive understanding ofthe evolution and new achievements of cost management, and how cost management isutilized in both domestic and overseas status quo. By introducing the theories ofactivity-based cost management, lean management, risk management, financialmanagement, and by using the methods of qualitative analysis, quantitative analysis, casestudy, this research shows that there exist some drawbacks of the cost management of boththe chosen case and the whole china’s manufacturing. Firstly, the concept and accountingof cost management still lag behind and there hasn’t formed a complete managementsystem. Secondly, the cost information is distorted and the information is not helpful withdecision-making. Thirdly, the incentive mechanism is imperfect. Then, the cause of thosedrawbacks has been discussed. As to the case, CSR Electric Company could and shouldaccept the concept of cost management. This study offered an activity-based costmanagement frame with implementation path, system elements, and informationtechnology platform. It will help the company better understanding the concept ofactivity-based cost management, improving management, and accelerating the pace ofbecoming a lean enterprise.By introducing the method of activity-based cost management, which contains theconcept of lean management, the overall cost management of CSR Electric Company have had a lot of achievement. This paper believes that activity-based cost management is anadvanced Management model of cost management. Although management is notcommonly used in China, and the implementation process encountered some difficultiesand problems, but that does not affect its bright prospects. Companies should follow thetrend, overcome difficulties and strive for conditions to implement this advanced costmanagement model.